Is this the beginning of the next tech bubble bursting? - RedditMigration to the "Threadiverse" - kbin.social
kbin.socialOriginal take found on another forum.
"I think we’re seeing the beginning of the tech bubble bursting again.
You’ve got the successful companies that provide a case study in tech industry profitability(Google, Amazon, Apple, etc.) which is why you’ve got all these venture capital firms plowing so much money into startups, left and right, because they expect that one of them will be the next Google or Amazon. Now that low interest rates have gone bye-bye, the VC firms are demanding that these startups start showing a profit. However, almost all of these startups have one of the following problems:
1.) They were never profitable and can never be profitable because the fundamental concept of what they do is thoroughly flawed
2.) The service or good they provide could be profitable, but due to being formed during a time of easy money, their current business model is incapable of being profitable, and they are too over leveraged to be able to restructure themselves into a more profitable setup
3.) They are perfectly sustainable/profitable, but their financiers expect far more return on investment than they are capable of providing
The result is the trend of “enshittification” as VC investors force unwanted changes onto these startups in the hopes of increasing revenue. This is stuff like locking previously free features behind a paywall, clogging everything with ads, cutting costs somewhere (payrolls, server space, etc) that negatively affects the user experience, raising prices, or needlessly bolting on something that nobody asked for because it’s one of the only things that VC firms might still blindly throwing money at(AI).
Even the actually profitable companies are doing this shit because they are just addicted to the ridiculous growth they’ve enjoyed in the past."
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I actually don’t believe this part. Reddit isn’t profitable because they have 2,000 employees on their payroll when they could probably get by with < 500. They hired all these engineers, and then put them on go-nowhere projects like NFTs, rather than improving their core platform.
If Reddit actually put that effort into making their app comparable to something like Apollo, I have no doubt plenty of users wouldn’t have minded shelling out for Premium instead of paying a similar price for a third party product. Hell, if they came out tomorrow and tied third party app API access to Reddit Premium membership, they might even turn profitable overnight.
Yep they’re shitty people that are shitty businessmen with no sense. Surprisingly, they think they’re geniuses and entrepreneurs
Could you imagine if Reddit put in effort to make interactive shit like they did on April Fools more regularly? Throw in some ads, you might have yourself a sustainable business. I knew something was fucked when they didn’t do anything this year.
They could make much more money if they only improved their current ad algorithm. I know a lot of people don’t, but I actually click on ads and enjoy ads that are targeted to me, especially for clothing. I purchase things from ads on every social media site that I use, except for Reddit, because reddit does not show me ads for things that I like, and this despite me using Reddit more than any other site. For instance, Reddit show me ads for internet packages, instead of the latest book or or dress that I would like to buy.
I’m not sure why this is, Reddit should know my interests better than many of these other sites. If their ads are failing, and they aren’t making money, it’s their own fault.
I don’t think this is a ‘tech bubble burst’, it’s more of an awakening. Big tech will continue to be invested more and more in themselves and find new ways to harvest information and profit what they can from their user base.
People want to find a place to connect, share ideas/experiences without having corporate overlords breathing down their necks. This is one of those places, and it reminds me of the '80’s when BBSs were the place to go.
God, I hope so. I don’t see any way to stop the billionaires from killing off our species, at this point. But I want to at least see those psychotic monsters suffer before we all go!
Honestly, I know what they’re trying to say, but I kind of object to calling what they do “thoroughly flawed”. Many of these big companies are starting to twist in the wind because they don’t provide a service that provides business value, and they don’t have a product that people will ever expect to pay for.
They provide community. And most people expect to belong to communities based on whether they can pay or not. Community isn’t a commodity. It’s just… Community.
And this is why Facebook is a cesspit. Because they had to break community bonds in order to actually sell things. Twitter’s walking down that road, too, but they’re too late, and anyone smart enough too make it woke is long gone. And now Reddit’s having a go…
But there’s nothing wrong with community. And there’s nothing wrong with community not being profitable. It’s not supposed to make money! That’s not what it exists for.
But to people who make their living owning shit and, anything that isn’t profitable isn’t worthwhile.
I want to control money in my lives, not have it control my lives, and Fediverse may be a way to protect my own identity in social networks from being turned into other people’s money.